YPB inks Chinese contract worth $16 million

Source: ARN, Brian Karlovsky; Published: 14th January 2015 

ASX-listed anti-counterfeiting technology company, YPB Group, has signed a contract worth about $16 million with Chinese company Shenzhen Shensaier.

It has entered into an exclusive 5-year contract for the provision of its anti-counterfeit invisible tracer products and T1 scanners.

Shenzhen Shensaier is one of China’s largest suppliers of high-end UV printing ink and paints for use in product packaging.

Under the contract Shenzhen Shensaier will include YPB’s tracer in all high-end inks supplied to China’s biggest tobacco brands and Chinese wine.

The contract is potentially worth AUD$16m (80 million RMB) based on projected revenues over term of the contract.

Orders under the contract are due to commence in the second quarter 2015, with revenues projected to flow from the end of the quarter.

YPB and Shenzhen Shensaier conducted factory and field trials of YPB’s tracer and scanner technology, and said that all its trials have passed with success.

YPB’s realProtection product detects rare-earth based trace elements, or tracer particles in the product, detectable only by a scanner and, in future, a phone app.

A rare earth element or rare earth metal is one of a set 17 chemical elements in the periodic table.

According to a company statement, it provides an invisible and indestructible anti-counterfeit solution that allows companies and governments to protect the value of their brands and minimise loss of earnings from counterfeiting.

The greater-Asian anti-counterfeit authentication market is valued at $US14 billion a year and growing 20 per cent each year. Shenzhen Shensaier is based in Guangdong, China, and is one of the country’s largest suppliers of high-end UV printing ink and paints. It has two production plants in China and supplies 18,000 tons of ink a year to the Chinese Tobacco industry, and owns 13 registered patent rights in this field.